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A new partnership for innovation between policymakers and industry

Dialogue12.03.2018

Where is the German automotive industry headed? And what can it contribute to environmental protection and clean air? These questions were discussed at VDA headquarters in Berlin by Matthias Müller, CEO of Volkswagen AG, and the Premier of the German state of Baden-Württemberg, Winfried Kretschmann (Alliance 90/The Greens).

A quick hardware retrofit to reduce diesel engine emissions immediately? This is not an option for Winfried Kretschmann: “I’m skeptical about that. If we look at how much time was needed for earlier software updates, you have to wonder how long hardware retrofits will take.” However, he does not believe the problem lies with the automotive industry and its ability to change: “The air is improving. The vehicles on Germany’s roads are being replaced with newer, more modern ones. The only problem is that it isn’t happening quickly enough.”

Bernhard Mattes, the new president of the VDA, also emphasized this positive development. In his welcoming remarks, Mattes mentioned that nitrogen oxide pollution had dropped by 70% in cities since 1990. Yet he also mentioned that the automotive industry has responsibilities: “There’s no question about it: Companies in our industry made mistakes. But we know about these mistakes now and they are being eliminated”, he said, looking ahead to the future. With the recent Federal Administrative Court ruling allowing diesel bans in city centers in mind, he warned: “It might result in a patchwork of different solutions in the cities and municipalities.”

Audi e-tron and E-Porsche in series production as soon as 2018/2019

VW CEO Matthias Müller explained that the necessary transformation has already begun at Volkswagen. The company recently launched its biggest initiative to restructure the company, “Roadmap E”. Over the next five years, it will invest around 34 billion euros in electrification, new mobility, and research in the fields of autonomous drives and digitalization, Müller said. “Production of the Audi e-tron quattro will start at our Brussels plant this year, and next year the first E-Porsche will roll off the production line in Zuffenhausen.”

By 2025, the Volkswagen Group plans to develop a total of 50 purely electric vehicles across its various brands, along with a further 30 plug-in hybrid vehicles. “If we want e-mobility to break out of the niche market, we have to talk about the framework conditions now”, says Müller. A transformation in mobility is an inevitable step on the way to cleaner air. To achieve this, Müller has called for a “new partnership for innovation between policymakers and industry.”

“Arena 2036” to forge closer ties between research and industry

An example of such cooperation can already be seen in Baden-Württemberg, where the government and the automotive industry have been working closely together since last year as part of a strategic dialog. Winfried Kretschmann outlined the goal of this cooperation: “It’s about actively shaping future developments and avoiding a situation where you are always behind the current trends.” Together with the federal government and partners from industry and research, “Arena 2036” was established, where representatives from research, industry, and start-ups work on the mobility of the future together. “The largest research complex in Europe”, as Kretschmann put it, is an example of how industry and science will have to work together more closely in the future “to keep up with the speed of our competitors at the very least”.

Matthias Müller also wants to strengthen this culture of cooperation at Volkswagen. The VW CEO sees opportunities for productive cooperation with IT companies, especially those with business models more closely related to data processing than mobility. “VW used to be a very secretive company. That has changed completely. The reality is that we can build cars really well, while other companies can analyze data really well. We want to consolidate this knowledge in the future.” On the way, the automobile will be subjected to an increasing transformation of its functions, in which it is “only one puzzle piece in a new, networked mobility”, said Müller.

The ever-increasing volume of freight traffic is already causing permanent congestion on highways, backing up traffic into nearby cities, said Premier Kretschmann. In this case, intelligent traffic management – such as assistance with avoiding traffic jams or with finding a parking space – would be useful. More coordinated means of transportation, from public transportation to cars, are also becoming increasingly important. These are solutions that VW CEO Müller is also open to. “Even I take the tram downtown occasionally. And I think that’s just fine.”